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The hydrogen peroxide was contained in a 10,000-gallon tank on the marine terminal and was linked to the port's stormwater treatment facility. The chemical was reintroducing oxygen into the stormwater before it was released into Budd Inlet.

After a valve ruptured on Jan. 28, 2015, the chemical spilled, which led to a large emergency response. Several businesses near the port's marine terminal were asked to evacuate, while some employees were asked to stay indoors.

Once the chemical entered the sewer system, it generated white vapor clouds that could be seen rising from manhole covers.

State Department of Ecology spill responders and Olympia Fire agreed to dilute the chemical, so fire officials popped open a manhole and sprayed water into the sewage system.

“Research on 50 percent hydrogen peroxide solution found it was a strong oxidizer and corrosive,” according to an Ecology report.

Other hazards include “fire, explosion, inhalation and skin/eye contact,” an Ecology official said.

After the spill, the port had to repair the system to make it safe and functional. Then the port and its insurance company, Enduris, demanded repayment from Herrera and 3 Kings for spill costs and repairs.

In lieu of legal action, representatives from the port, Enduris, Herrera and 3 Kings met before a Seattle mediator to negotiate a settlement. Although 3 Kings was part of that mediation, the settlement was only with Herrera.

Including the $250,000 settlement, the port has recovered $354,000 in costs related to the spill, interim executive director Rudy Rudolph told the commission.

Rudolph said the hydrogen peroxide system is now working as designed. A plastic valve was replaced with stainless steel and the stormwater treatment facility also has better containment, he said.